Do a negative to the deduction you want to refund to them. It will then add the appropriate subject-to and taxable to the wages and reduce the YTD withheld for that deduction.

Thank you John. However that is how we were handling the refunds. With the year end recon, we have found that entering a negative deduction for the Health Insurance Deduction, gives the employee the full refund, without taxing it. So that wage was not taxed as it should have been.

John is correct. The exact steps to follow can be found in the knowledgebase article - Can I refund a pretax deduction and create the taxable and subject-to amounts on the employee record? (Article ID 23905). You can find it by searching in the knowledgebase using the article title, or article ID. Hope this helps.

Thank you! The article indicated what our issue was. We need to have taxable earnings in the refund, for it to calculate properly. The checks we found only had the refund and no taxable wages. Thank you again!